Artemis Papatheodorou & Associates

Being one of the most experienced and dynamic global investment fund centers and the largest investment fund center in Europe, Luxembourg is an ideal location for the structuring, administration and distribution of investment funds.

Luxembourg provides for two main categories of investment funds or, in other words, Undertakings for Collective Investment (UCI), firstly there are Undertakings for Collective Investment in Transferable Securities (UCITS) and secondly Alternative Investment Funds (AIFs).

Regardless of the type of fund, investment funds have in common the following characteristics, firstly, there is a collective investment of funds, secondly, the capital is raised from a number of investors and thirdly, it is invested in compliance with a specific investment policy, generally in accordance with the principle of risk spreading.

Investment Funds may take various legal forms, they can be established as a Contractual Fund (FCP – Fond Commun de Placement), an Investment Company with Variable Capital (SICAV – Société d’Investissement à Capital Variable) or an Investment Company with Fixed Capital (SICAF – Société d’Investissement à Capital Fixe).

However, the choice of structure an investor elects, depends on the investment policy of his choice as well as the distribution strategy of the fund.

A further feature of investment funds is that they can be structured along the lines of a single fund or as what has come to be called an umbrella fund. Umbrella funds, are funds with multiple compartments meaning that the legal entity creates separate sub funds which each have a separate investment policy and investor profile. In turn such sub funds can issue different classes of shares.

Although Luxembourg has built a strong reputation around the UCITS brand, it also has expertise in the field of Alternative Investment Funds. The Hedge Fund sector has developed rapidly. Similarly the competitive structures for setting up Private Equity and Venture Capital Funds enable private equity acquisitions either at a European level or within individual countries. Additionally, Real Estate Investment Funds (REIFs), which represent a diversification from traditional assets, have become more and more attractive to investors throughout Europe.

From the perspective of the Shipping Industry, the regulatory, tax and legal environment in Luxembourg is ideal for players in the industry interested in Open Ended Shipping Investment Funds thereby turning to alternative means of investment and funding.

For further information concerning investment management and the structuring and servicing of Luxembourg Investment Funds please contact Artemis Papatheodorou.

T: + 30 210 6753856
E: apapatheodorou@ap-lawoffices.com